Welfare reform fails to end poverty, study says

September 30, 2003|By Tim Jones, Tribune national correspondent.

Welfare reform in Wisconsin has dramatically cut public assistance roles, but efforts in Milwaukee to place welfare recipients into jobs have not succeeded in pulling people out of chronic poverty and into self-sufficiency, according to a study by the Universities of Chicago and Wisconsin being released Tuesday.

The study of Wisconsin Works, or W-2, said that people who enrolled in the workfare program in Milwaukee County continued to suffer from homelessness, depression and other personal and economic hardships, despite an increase in income and additional cash assistance.

The income of more than eight in 10 participants in W-2 also lagged far below the official federal poverty level, the study showed.

"We're not seeing much evidence that the services are really significantly improving the lives of these people. They're not getting worse, but they're not getting better," said Mark Courtney, director of the University of Chicago's Chapin Hall Center for Children and an author of the study.

If other states pursue the reform strategy adopted by Wisconsin, Courtney said, they will have to recognize that the trade-off in cutting welfare roles is a smaller but "more troubled caseload" that will require additional assistance.

The report from the Chapin Hall Center at the University of Chicago and the Institute for Research on Poverty at the University of Wisconsin-Madison followed nearly 1,100 applicants for W-2, a 1996 program designed to quickly move people off public assistance and into the paid work force.

Over a 15- to 18-month period starting in 1999, the study found that employment "did not necessarily translate into self-sufficiency." Welfare applicants who participated in the program continued to experience the same personal and economic troubles as those who were not part of the program.

While Courtney said it is too soon to draw long-term conclusions about W-2, this study suggests there is a core of poor people with families whose needs generally have not been addressed by government programs.

While states across the nation, including Illinois, have embraced different forms of workfare to reduce welfare rolls, Wisconsin, which began reforming welfare in the late 1980s, has been one of the most aggressive. The state's caseload has dropped about 80 percent in the last decade.

"How you see the success of welfare reform depends on what you think it should accomplish. If you judge it by the ability to the reduce caseload, then it is a resounding success," Courtney said.

"But whatever W-2's stated goals are, the folks who walked in the door in 1999 are still facing pretty significant hardships," Courtney added.

The median annual income of W-2 participants was $4,131. With W-2 cash assistance and food stamps for 12 months, the income level rose to $8,583, the report said. That is more than twice the income of welfare recipients who were not part of W-2, but it was far behind the poverty threshold for a family of three, which was $14,269 in 2001.

A growing list of reports on individual state efforts to reform welfare shows, in most instances, large drops in caseloads.

A study released last week by the University of Missouri-Columbia said the caseload in Missouri was halved from 1990 to 1999. The report said residents who left welfare in the 1990s earn low wages and tend to work in less stable jobs, but those individuals appear to have benefited from welfare reform.

In Milwaukee County, the survey reported that nearly half (47 percent) of those surveyed had been unable to pay their rent or mortgage. It also found that 47 percent had their phones disconnected. "It's not surprising but it is good solid evidence of what we've been seeing in real life," said John Bouman, director of advocacy for the Chicago-based National Center for Poverty Law.

Bouman said it is difficult to generalize about the success of welfare reform efforts because there are examples that show people have emerged from public assistance and become self-sufficient. But Bouman said last week's government figures showing that another 1.7 million Americans slid into poverty last year underscore the challenge of finding good jobs and holding onto them.